(Reuters) – Alibaba has announced its intention to invest $3.6 billion to acquire a share in Sun Art, to gain more influence in the Chinese retail market.
The e-commerce giant Alibaba hopes to further leverage its digital presence to support the 481 Sun Art stores including the three medium-sized supermarkets in China. The move comes as Alibaba steadily expands its presence in China’s offline retail sector, with growth in traditional e-commerce slowing.
Alibaba, which already owns 21% of Sun Art, will raise their stake to 72% by acquiring a similar stake in A-Art Retail, which owns 51% of Sun Art.
“As the COVID-19 pandemic has accelerated the digitization of consumer lifestyles and enterprise operations, this commitment to Sun Art advances our new vision of retail and serve more consumers with a fully integrated and aligned experience” said Daniel Chang, Alibaba Chairman and CEO. for the current situation.”
Alibaba added that Peter Huang will be the Chairman of the Board of Directors of Sun Art in addition to his current role as CEO.
Sun Art’s shares jumped more than 27% by Monday evening after Alibaba’s announcement.
It is reported that Alibaba has expanded its outlets across China for Freshippo, a supermarket chain that operates as an online delivery service. According to the company’s latest earnings report, Alibaba operates 214 Freeshipbo outlets.
they also worked with store owners to provide technology and data analysis services.
Online retailer JD operates a grocery store called Fresh V.
Bindudu, owner of the fast-growing e-commerce site known for its budget deals on wholesale purchases, bought a share in home appliance retailer Gome Retail in August for $200 million.